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SENATE FLOOR VERSION
February 8, 2021
SENATE BILL NO. 821 By: McCortney, Murdock, Kidd,
Pemberton, Stephens,
Daniels, Garvin, Stanley,
Bullard, Rogers,
Standridge, Hicks and
Weaver
An Act relating to the Patient’s Right to Pharmacy
Choice Act; amending Section 3, Chapter 426, O.S.L.
2019 (36 O.S. Supp. 2020, Section 6960), which
relates to definition s; adding definition s of
pharmacy benefits management and retail pharmacy;
modifying definitions; amending Section 4, Chapter
426, O.S.L. 2019 (36 O.S. Supp. 2020, Section 6961),
which relates to retail pharmacy network access
standards; specifying access standards; modifying
prohibition by pharmacy benefit managers; amending
Section 5, Chapter 426, O.S.L. 2019 (36 O.S. Supp.
2020, Section 6962), which relates to compliance
review; modifying certain contract restrictions;
amending Section 6, Chapter 426, O.S.L. 2019 (36 O.S.
Supp. 2020, Section 6963), which relates to health
insurer monitoring; modifying monitoring requirements
of certain insurers; conforming language; repealing
Section 7, Chapter 426, O.S.L. 2019 (36 O.S. Supp.
2020, Section 6964), which relates to health insurer
formularies; and providing an effective date .
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKL AHOMA:
SECTION 1. AMENDATORY Section 3, Chapter 426, O.S.L.
2019 (36 O.S. Supp. 2020, Section 6960), is amended to read as
follows:
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Section 6960. For purposes of the Pati ent’s Right to Pharmacy
Choice Act:
1. “Health insurer” means any corporation, association, benefit
society, exchange, partnership or individual licensed by the
Oklahoma Insurance Code;
2. “Mail-order pharmacy” means a pharmacy licensed by this
state that primarily dispenses and delivers covered drugs via common
carrier;
3. “Pharmacy benefits management” means any or all of the
following activities:
a. provider contract negotiation and/or provider n etwork
administration, including decisions related to
provider network participation stat us,
b. drug rebate contract negotiation or drug rebate
administration, and
c. claims processing which may include claim billing and
payment services;
4. “Pharmacy benefits manager ” or “PBM” means a person or
entity that performs pharmacy benefits manage ment activities and any
other person or entity acting for such a person or entity performing
pharmacy benefits management activities under a contractual or
employment relationship in the performance of pharmacy benefits
management for a managed -care company, nonprofit hospital, medica l
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service organization, insurance company, third-party payor or a
health program administered by a department of this state ;
4. “Pharmacy and therapeutics committee ” or “P&T committee”
means a committee at a hospital or a heal th insurance plan that
decides which drugs will appear on that entity’s drug formulary;
5. “Retail pharmacy” or “provider” means a pharmacy, as defined
in Section 353.1 of Title 59 of the Oklahoma Statutes licensed by
the State Board of Pharmacy or an age nt or representative of a
pharmacy;
5. 6. “Retail pharmacy network” means retail pharmacy providers
contracted with a PBM in which the pharmacy primarily fills and
sells prescriptions via a retail, storefront location ;
6. 7. “Rural service area” means a five-digit ZIP code in which
the population density is less than one thousand (1,000) individuals
per square mile;
7. 8. “Suburban service area ” means a five-digit ZIP code in
which the population density is between on e thousand (1,000) and
three thousand (3,000) individuals per square mile; and
8. 9. “Urban service area” means a five-digit ZIP code in which
the population density is greater than three thousand (3,000)
individuals per square mile.
SECTION 2. AMENDATORY Section 4 , Chapter 426, O.S.L.
2019 (36 O.S. Supp. 202 0, Section 6961), is amended to read as
follows:
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Section 6961. A. Pharmacy benefits managers (PBMs) shall
comply with the following retail pharmacy network access standards:
1. At least ninety percent (90%) of covered individuals
residing in an each urban service area live within two (2) miles of
a retail pharmacy participating in the PBM ’s retail pharmacy
network;
2. At least ninety percent (90%) of covere d individuals
residing in an each urban service area live within five (5) miles of
a retail pharmacy designated as a preferred participating pharmacy
in the PBM’s retail pharmacy network;
3. At least ninety percent (9 0%) of covered individuals
residing in a each suburban service area live within five (5) miles
of a retail pharmacy participating in the PBM’s retail pharmacy
network;
4. At least ninety percent (90%) of covered individuals
residing in a each suburban service area live within seven (7) miles
of a retail pharmacy designated as a preferred participating
pharmacy in the PBM’s retail pharmacy network;
5. At least seventy percent (70%) of covered individuals
residing in a each rural service area live within fi fteen (15) miles
of a retail pharmacy participating in the PBM ’s retail pharmacy
network; and
6. At least seventy percent (70%) of cove red individuals
residing in a each rural service area live within eighteen (18)
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miles of a retail pharmacy designated as a preferred participating
pharmacy in the PBM’s retail pharmacy network.
B. Mail-order pharmacies shall not be used to meet access
standards for retail pharmacy networks.
C. Pharmacy benefits managers shall not require patients to use
pharmacies that are directly or indirectly owned by the or
affiliated with a pharmacy benefits manager , including all regular
prescriptions, refills or sp ecialty drugs regardless of day supply.
D. Pharmacy benefits managers shall not in any manner on any
material, including but not limited to mail and ID cards , include
the name of any pharmacy, hospital or other providers unless it
specifically lists all p harmacies, hospitals and providers
participating in the prefe rred and nonpreferred pharmacy and health
networks.
SECTION 3. AMENDATORY Section 5, Chapter 426, O.S.L.
2019 (36 O.S. Supp. 2020, Section 6962), is amended to read as
follows:
Section 6962. A. The Oklahoma Insurance Department shall
review and approve ret ail pharmacy network access for all ph armacy
benefits managers (PBMs) to ensure compliance with Section 4 of this
act.
B. A PBM, or an agent of a PBM, shall n ot:
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1. Cause or knowingly permit the use of advertisement,
promotion, solicitation, representati on, proposal or offer that is
untrue, deceptive or misleading;
2. Charge a pharmacist or pharmacy a fee related to the
adjudication of a claim , including without limitation a fee for:
a. the submission of a claim,
b. enrollment or participation in a retai l pharmacy
network, or
c. the development or management of claims processing
services or claims payment services related to
participation in a retail pharmacy network;
3. Reimburse a pharmacy or pharmacist in the state an amount
less than the amount that the PBM reimburses a pharmacy owned by or
under common ownership with a PBM for providing the same covered
services. The reimbursement amount paid to the phar macy shall be
equal to the reimbursement amount calculated on a per -unit basis
using the same generic product identifier or generic cod e number
paid to the PBM-owned or PBM-affiliated pharmacy;
4. Deny a pharmacy the opportunity to participate in any
pharmacy network at preferred participation status if the pharmacy
is willing to accept the terms and conditions that the PBM has
established for other pharmacies as a condition of preferred network
participation status;
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5. Deny, limit or terminate a pharmacy ’s contract based on
employment status of any employee who has an active license to
dispense, despite probation status, with the State Board of
Pharmacy;
6. Retroactively deny or reduce reimbursement for a covered
service claim after returning a paid clai m response as part of the
adjudication of the claim, unless:
a. the original claim was submitted fraudulently, or
b. to correct errors identified in an audit, so long as
the audit was conducted in compliance with Sections
356.2 and 356.3 of Title 59 of the Oklahoma Statutes;
or
7. Fail to make any payment due to a pharmacy or pharmacist for
covered services properly rendered in the event a PBM terminates a
pharmacy or pharmacist from a pharmacy benefits manager network.
C. The prohibitions under this sect ion shall apply to contracts
between pharmacy benefits managers and pharmacists or pharmacies
providers for participation in retail ph armacy networks.
1. A PBM provider contract shall not prohibit, restrict or
penalize a pharmacy or pharmacist in any way for disclosing to an
individual any health care information that the pharmacy or
pharmacist deems appropriate regarding :
a. not restrict, directly or indirectly, any pharmacy
that dispenses a prescription drug from informing, or
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penalize such pharmacy for informin g, an individual of
any differential between the individual ’s out-of-
pocket cost or coverage with respect to acquisition of
the drug and the amount an individual would pay to
purchase the drug directly the nature of treatment,
risks or alternatives to the prescription drug being
dispensed, and
b. ensure that any entity that provides pharmacy benefits
management services under a c ontract with any such
health plan or health insurance coverage does not,
with respect to such plan or coverage, restrict,
directly or indirectly, a pharmacy that dispenses a
prescription drug from informing, or penaliz e such
pharmacy for informing, a cover ed individual of any
differential between the individual ’s out-of-pocket
cost under the plan or coverage with respect to
acquisition of the drug and the amount an individual
would pay for acquisition of the drug withou t using
any health plan or health insu rance coverage the
availability of alternate therapies, consultations or
tests,
c. the decision of utilization reviewers or similar
persons to authorize or deny services, and
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d. the process that is used to authorize or deny
healthcare services and struct ures used by the health
insurer.
2. Provider contracts shall not prohibit a pharmacy or
pharmacist from discussing information rega rding the total cost of
pharmacist services for a prescription drug or from selling a m ore
affordable alternative to the cove red person if such alternative is
available.
A pharmacy benefits manager ’s contract with a participating
pharmacist or pharmacy 3. Provider contracts shall not prohibit,
restrict or limit disclosure of informati on to the Insurance
Commissioner, law enf orcement or state and federal governmental
officials investigating or examining a complaint or conducting a
review of a pharmacy benef its manager’s compliance with the
requirements under the Patient ’s Right to Pharmacy Choice Act.
3. 4. A pharmacy benefits manager shall establish and maintain
an electronic claim inquiry processing system using the National
Council for Prescription Drug Programs’ current standards to
communicate information to pharmacies submitting clai m inquiries.
5. Provider contracts shall not establish drug product
reimbursement terms that fall below a price point of the National
Average Drug Acquisition Cost plus six percent (6%) of that cost,
plus Twelve Dollars ($12.00) or in the event a National Average Drug
Acquisition Cost has not been established, the wholesale acquisition
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cost minus two percent (2%) of the cost, plus Twelve Dollars
($12.00).
SECTION 4. AMENDATORY Section 6, Chapter 426, O.S.L.
2019 (36 O.S. Supp. 2020, Section 6963), is amended to read as
follows:
Section 6963. A. A health insurer shall be responsible for
monitoring all activities carried out by, or on behalf of, the
health insurer under the Patient’s Right to Pharmacy Choice Act, and
for ensuring that all requirements of this act are met.
B. Whenever a health insurer performs pharmacy benefit
management on its own behalf or contracts with another person or
entity to perform activities required under this act pharmacy
benefit management, the health insurer shall be responsible for
monitoring the activities and conduct of that person or entity with
whom the health insurer contracts and for ensuring that the
requirements of this act are met.
C. An individual may be no tified at the point of sale when the
cash price for the purchase of a prescription drug is less than the
individual’s copayment or coinsurance p rice for the purchase of the
same prescription drug.
D. A health insurer or pharmacy benefits manager (PBM) sha ll
not restrict an individual ’s choice of in-network provider for
prescription drugs.
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E. An individual’s A patient’s choice of in-network provider
may include a retail pharmacy or a mail -order pharmacy. A health
insurer or PBM shall not restrict such the choice of pharmacy
provider. Such A health insurer or PBM shall not require or
incentivize using any discounts in cost -sharing or a reduction in
copay or the number of copays to ind ividuals to receive prescription
drugs from an individual’s choice of in-network pharmacy.
F. A health insurer, pharmacy or PBM shall adhere to all
Oklahoma laws, statutes and rules when mailing, shipping and/or
causing to be mailed or shipped prescriptio n drugs into the Sta te of
Oklahoma.
SECTION 5. REPEALER O.S. 2011, Section 7, Chapter 426,
O.S.L. 2019 (36 O.S. Supp. 2020, Section 6964), is hereby repealed.
SECTION 6. This act shall become effective Nove mber 1, 2021.
COMMITTEE REPORT BY: COMMITTEE ON HEALTH AND HUMAN SERVICES
February 8, 2021 - DO PASS